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Exhibit 10.42
PLEDGE AGREEMENT
CAMINUS LLC
THIS PLEDGE AGREEMENT, dated as of September 1, 1999, is made by
Caminus LLC, a Delaware limited liability company (the "Pledgor"), to Fleet
Bank, N.A., a national banking association organized under the laws of the
United States, as lender (hereinafter, in such capacity, together with its
successors in such capacity, the "Lender") under the Credit Agreement referred
to below.
The Pledgor and the Lender are parties to a Credit Agreement dated
as of June 23, 1999 (such Credit Agreement, as the same may be amended or
supplemented from time to time is referred to herein as the "Credit Agreement")
providing, subject to the terms and conditions thereof, for extensions of credit
to be made by the Lenders to the Pledgor in an aggregate principal amount not
exceeding $5,000,000 (the "Loans"). The Loans made or to be made by the Lender
to the Pledgor shall be evidenced by certain promissory notes (as exchanged,
replaced, amended, supplemented or modified from to time, the "Notes") in
substantially the form of Exhibits A-1 and A-2 attached to the Credit Agreement.
The Pledgor is the legal and beneficial owner of all of the shares
of Capital Stock of Caminus/DC Acquisition Corp., a Delaware corporation (the
"Company") (such shares of Capital Stock and such additional shares of Capital
Stock of the Company and any property at any time and from time to time
receivable by the Lender hereunder or otherwise distributed in respect of or in
exchange for any such shares, including any stock options or rights received as
provided in Section 3 of this Agreement, are hereinafter referred to as the
"Pledged Stock").
For other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Pledgor has agreed to execute
and deliver this Agreement.
1. Defined Terms. Unless otherwise defined herein, terms defined in
the Credit Agreement shall have such defined meanings when used herein.
2. Pledge. The Pledgor hereby pledges, assigns, hypothecates,
transfers, and delivers to the Lender, all the Pledged Stock and hereby grants
to the Lender, a first lien on, and security interest in, the Pledged Stock and,
except as hereinafter provided, in all increases and profits therefrom and all
proceeds thereof, together with appropriate undated stock and/or transfer powers
with respect thereto duly executed in blank, as security for the payment,
performance and observance of all indebtedness, obligations, liabilities and
agreements of the Pledgor to the Lender of whatever nature, pursuant to, under
or arising out of, the Credit Agreement, the Notes, the other Loan Documents and
any amendments, extensions, renewals, refundings or modifications thereto or of
any part thereof, whether now existing or hereafter incurred, matured or
unmatured, direct or contingent, together with interest and costs of enforcement
and collection thereof and of this Agreement, including all reasonable actual
attorneys' fees and disbursements incurred by the Lender (collectively, the
"Liabilities").
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3. Collateral. All property at any time pledged with the Lender
hereunder (whether described herein or not) and all increases, profits and
income therefrom and proceeds thereof, are herein collectively sometimes called
the "Collateral".
4. Stock Dividends, Distributions, etc. If, while this Agreement is
in effect, the Pledgor shall become entitled to receive or shall receive any
stock certificate (including, without limitation, any certificate representing a
stock dividend or a distribution in connection with any reclassification,
increase or reduction of capital, or issued in connection with any
reorganization, merger or consolidation, or resulting from a split-up, revision
or other like change of the Pledged Stock or otherwise received in exchange
therefor), option or rights, whether by purchase or other acquisition or as an
addition to, in substitution of, or in exchange for any shares of any Pledged
Stock, the Pledgor agrees to accept the same as agent of the Lender and to hold
the same in trust on behalf of and for the benefit of the Lender, and to deliver
the same forthwith to the Lender in the exact form received, with the
endorsement of the Pledgor when necessary and/or appropriate undated stock
and/or transfer powers duly executed in blank, to be held by the Lender, subject
to the terms hereof, as additional collateral security for the Liabilities. Any
sums paid upon or in respect of the Pledged Stock upon the liquidation or
dissolution of the issuer thereof shall be paid over to the Lender to be held by
it in trust as additional collateral security for the Liabilities; and in case
any distributions of capital shall be made on or in respect of the Pledged Stock
or any property shall be distributed upon or with respect to the Pledged Stock
pursuant to the recapitalization or reclassification of the capital of the
issuer thereof or pursuant to the reorganization thereof, the property so
distributed shall be delivered to the Lender to be held by it as additional
collateral security for the Liabilities (except as otherwise provided in Section
5 hereof). All sums of money and property so paid or distributed in respect of
the Pledged Stock which are received by the Pledgor shall, until paid or
delivered to the Lender, be held by the Pledgor in trust as additional
collateral security for the Liabilities.
5. Cash Dividends; Voting Rights. Subject to any restrictions in the
Credit Agreement, the Pledgor shall be entitled to receive all cash dividends
paid in respect of the Pledged Stock. So long as no Event of Default has
occurred and is continuing under the Credit Agreement, the Pledgor shall be
entitled (as permitted by the Company's Articles of Incorporation) to vote the
Pledged Stock and to give consents, waivers and ratifications in respect of the
Pledged Stock (as the case may be), provided, however, that no vote shall be
cast or consent, waiver or ratification given or action taken which would impair
the Collateral or be inconsistent with or violate any provision of this
Agreement, the Credit Agreement, the Notes or the other Loan Documents.
6. Amendments, Modifications and Waivers with Respect to
Liabilities. The Pledgor hereby consents that, without the necessity of any
reservation of rights against the Pledgor (but subject to the provisions of the
Credit Agreement), and without notice to or further assent by the Pledgor, any
demand for payment of any of the Liabilities made by the Lender may be rescinded
by the Lender and any of the Liabilities continued, and the Liabilities, or the
liability of the Pledgor or any other party upon or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered, or released by
the Lender, and the Credit Agreement, the Notes, any collateral
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security documents (including, without limitation, the other Collateral
Documents) or guarantees or documents in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, as the Lender may
deem advisable from time to time (subject to the consent of the Lender under the
Credit Agreement), and any collateral security (including, without limitation,
the Collateral Documents) at any time held by the Lender for the payment of the
Liabilities may be sold, exchanged, waived, surrendered or released (in
accordance with the terms thereof), all without the necessity of any reservation
of rights against the Pledgor and without notice to or further assent by the
Pledgor, which will remain bound hereunder, notwithstanding any such renewal,
extension, modification, acceleration, compromise, amendment, supplement,
termination, sale, exchange, waiver, surrender or release. The Lender shall have
no obligation to protect, secure, perfect or insure any other collateral
security document (including, without limitation, the other Collateral
Documents) or property subject thereto at any time held as security for the
Liabilities. The Pledgor waives any and all notice of the creation, renewal,
extension or accrual of any of the Liabilities and notice of or proof of
reliance by the Lender upon this Agreement, and the Liabilities shall
conclusively be deemed to have been created, contracted or incurred in reliance
upon this Agreement, and all dealings between the Lender and the Pledgor shall
likewise be conclusively presumed to have been made or consummated in reliance
upon this Agreement. The Pledgor waives diligence, presentment, protest, demand
for payment and notice of default or nonpayment to or upon the Pledgor or any
other person with respect to the Liabilities.
7. Rights of the Lender. The Lender shall not be liable for failure
to collect or realize upon the Liabilities or any collateral security or
guarantee therefor, or any part thereof, or for any delay in so doing nor shall
it be under any obligation to take any action whatsoever with regard thereto.
Any or all shares of the Pledged Stock held by the Lender hereunder may, if an
Event of Default shall have occurred and be continuing under the Credit
Agreement, without notice, be registered in the name of the Lender or its
nominee, and the Lender or its nominee may thereafter without notice, exercise
all voting and corporate rights at any meeting of any corporation issuing any of
the shares included in the Pledged Stock and exercise any and all rights of
conversion, exchange, subscription or any other rights, privileges or options
pertaining to any shares of the Pledged Stock as if it were the absolute owner
thereof, including without limitation, the right to exchange, at its discretion,
any and all of the Pledged Stock upon the merger, consolidation, reorganization,
recapitalization or other readjustment of any corporation issuing any of such
shares or upon the exercise by any such issuer or the Lender of any right,
privilege or option pertaining to any shares of the Pledged Stock, and in
connection therewith, to deposit and deliver any and all of the Pledged Stock
with any committee, depositary, transfer agent, registrar or other designated
agency upon such terms and conditions as it may determine, all without liability
except to account for property actually received by it, but the Lender shall
have no duty to exercise any of the aforesaid rights, privileges or options and
shall not be responsible for any failure to do so or delay in so doing.
8. Remedies. Upon the occurrence of an Event of Default under the
Credit Agreement or in the event that any portion of the Liabilities has been
declared due and payable, the Lender, in addition to any rights of the Lender
hereunder, without demand of performance or other demand, advertisement or
notice of any kind (except the notice specified below of time and place of
public or private sale) to or upon the Pledgor or any other Person (all and each
of which demands, advertisements and/or notices are hereby expressly waived),
may forthwith collect,
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receive, appropriate and realize upon the Collateral, or any part thereof,
and/or may forthwith sell, assign, give option or options to purchase, contract
to sell or otherwise dispose of and deliver said Collateral, or any part
thereof, in one or more parcels at public or private sale or sales, at any
exchange, brokers' board or at any of the Lender's offices or elsewhere upon
such terms and conditions as it may deem advisable and such public sale or
sales, (or, to the extent permitted by law, such private sale) to purchase the
whole or any part of said Collateral so sold, shall be free of any right or
equity of redemption of the Pledgor, which right or equity is hereby expressly
waived and released. The Lender shall apply the net proceeds of any such
collection, recovery, receipt, appropriation, realization or sale (after
deduction of all reasonable costs and expenses of every kind incurred therein or
incidental to the care, safekeeping or otherwise of any and all of the
Collateral or in any way relating to the rights of the Lender hereunder,
including attorneys' fees and legal expenses) against payment in whole or in
part, of the Liabilities in such order as the Lender may elect (subject to
statutory requirements), and only after so applying such net proceeds and after
the payment by the Lender of any other amount required by any provision of law,
need the Lender account for the surplus, if any, to the Pledgor. The Pledgor
agrees that the Lender need not give more than ten days' notice of the time and
place of any public sale or of the time after which a private sale or other
intended disposition is to take place and that such notice is reasonable
notification of such matters. In addition to the rights and remedies granted to
it in this Agreement and in any other instrument or agreement securing,
evidencing or relating to any of the Liabilities, the Lender shall have all the
rights and remedies of a secured party under the Uniform Commercial Code of the
State of New York.
9. Representations, Warranties and Covenants of the Pledgor. The
Pledgor represents and warrants that (a) the Pledgor is a limited liability
company duly organized, validly existing, and in good standing under the laws of
the State of Delaware; (b) the Pledgor is the legal record and beneficial owner
of, and has good title to, the Pledged Stock, subject to no pledge, lien,
mortgage, hypothecation, security interest, charge, option or other encumbrance
whatsoever, except the lien and security interest created by this Agreement; (c)
all the shares of the Pledged Stock have been duly and validly issued, are fully
paid and non-assessable; (d) the pledge, assignment and delivery of such Pledged
Stock pursuant to this Agreement creates a valid first lien on and a first
perfected security interest in such shares of the Pledged Stock, and the
proceeds thereof, subject to no prior pledge, lien, mortgage, hypothecation,
security interest, charge, option or encumbrance or to any agreement purporting
to grant to any third party a security interest in the property or assets of the
Pledgor which would include the Pledged Stock; (e) the Pledged Stock
constitutes, in the aggregate, 100% of the issued and outstanding shares of
capital stock of the Company as of the date of this Agreement; (f) the Pledgor
has the power, right and authority to execute and deliver this Agreement; (g)
the execution, delivery and performance by the Pledgor of this Agreement do not
and will not (1) require any consent or approval of any Person that has not been
obtained, (2) contravene its Articles of Organization or Operating Agreement,
(3) violate any provisions of any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award presently in effect applicable to the
Pledgor, (4) result in a breach of, constitute a default under or otherwise
contravene any indenture or loan or credit agreement or any other agreement,
lease or instrument to which the Pledgor is a party or by which the Pledgor or
the Pledgor's properties may be bound or affected, (5) result in, or require,
the creation or imposition of any Lien (other than a Lien in favor of the
Lender) upon or with respect to any of the Pledgor's properties now owned or
hereafter acquired, or (6) cause the Pledgor to be in default under any such
law, rule, regulation, order, writ,
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judgment, injunction, decree, determination or award or any such indenture,
agreement, lease or instrument; (h) this Agreement has been duly authorized,
executed and delivered by the Pledgor and constitutes a legal, valid and binding
obligation of the Pledgor, enforceable against the Pledgor in accordance with
its terms, except to the extent that such enforcement may be limited by
applicable bankruptcy, insolvency and other similar laws affecting creditors'
rights generally; and (i) there is no action, suit or proceeding pending or
threatened against or otherwise affecting the Pledgor before any Governmental
Authority or any arbitrator which may adversely affect the ability of the
Pledgor to perform its obligations under this Agreement. The Pledgor covenants
and agrees that the Pledgor will defend the Lender's right, title and security
interest in and to the Pledged Stock and the proceeds thereof against the claims
and demands of all persons whomsoever; and covenants and agrees that the Pledgor
will have like title to and right to pledge any other property at any time
hereafter pledged to the Lender, as Collateral hereunder and will likewise
defend the Lender's right thereto and security interest therein.
10. No Disposition, etc. Without the prior written consent of the
Lender, the Pledgor agrees that the Pledgor will not sell, assign, transfer,
exchange, or otherwise dispose of, or grant any option with respect to, the
Pledged Stock or any of the other Collateral, nor will the Pledgor create,
incur, or permit to exist any pledge, lien, mortgage, hypothecation, security
interest, charge, option or any other encumbrance with respect to the Pledged
Stock or any of the other Collateral, or any interest therein, or any proceeds
thereof, except for the lien and security interest provided for by this
Agreement. Without the prior written consent of the Lender, the Pledgor agrees
that the Pledgor will not vote to enable the Company to, and will not otherwise
permit the Company to, issue any stock or other securities of any nature in
addition to or in exchange or substitution for the Pledged Stock.
11. Disposition of Pledged Stock. (a) If the Lender shall determine
to exercise its rights to sell any or all of the Pledged Stock pursuant hereto,
and if in the opinion of counsel for the Lender it is necessary to have the
Pledged Stock, or that portion thereof to be sold, registered under the
provisions of the Securities Act of 1933, as amended (the "Securities Act"), the
Pledgor will cause each issuer of shares included in the Pledged Stock
contemplated to be sold, to use its reasonable best efforts to execute and
deliver, and will use its reasonable best efforts to cause the directors and
officers of each thereof to execute and deliver, all such instruments and
documents, and to do or cause to be done all such other acts and things as may
be necessary or, in the opinion of the Lender, advisable to register the Pledged
Stock, or that portion thereof to be sold, under the provisions of the
Securities Act and to cause the registration statement relating thereto to
become effective and to remain effective for a period of one year from the date
of the first public offering of the Pledged Stock, or that portion thereof to be
sold, and to make all amendments thereof and/or to the related prospectus which,
in the opinion of the Lender, are necessary, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. The Pledgor agrees to
cause each such issuer to comply with the provisions of the securities or "Blue
Sky" laws of any jurisdiction which the Lender shall designate and to cause each
such issuer to make available to its security holders, as soon as practicable,
an earnings statement (which need not be audited) which will satisfy the
provisions of Section 11(a) of the Securities Act.
(b) The Pledgor recognizes that the Lender may be unable to effect a
public sale of any or all of the Pledged Stock by reason of certain prohibitions
contained in the Securities
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Act and applicable state securities laws, but may be compelled to resort to one
or more private sales thereof to a restricted group or purchasers who will be
obliged to agree, among other things, to acquire such securities for their own
account for investment and not with a view to the distribution or resale
thereof. The Pledgor acknowledges and agrees that any such private sale may
result in prices and other terms less favorable to the seller than if such sale
were a public sale and, notwithstanding such circumstances, agrees that any such
private sale shall be deemed to have been made in a commercially reasonable
manner. The Lender shall be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the issuer of such
securities to register such securities for public sale under the Securities Act,
or under the applicable state securities laws, even if the issuer would agree to
do so.
(c) The Pledgor further agrees to use such reasonable efforts to do
or cause to be done all such other acts and things as may be reasonably
requested by the Lender which are within its power and necessary to make such
resale or sales of any portion or all of the Pledged Stock valid and binding and
in compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sale or sales, all at the Pledgor's expense. The Pledgor further agrees
that a breach of any of the covenants contained in this paragraph 11 will cause
irreparable injury to the Lender, that the Lender has no adequate remedy at law
in respect of such breach and, as a consequence, agrees that each and every
covenant contained in this paragraph shall be specifically enforceable against
the Pledgor and the Pledgor hereby waives and agrees not to assert any defenses
against an action for specific performance of such covenants. The Pledgor
further acknowledges the impossibility of ascertaining the amount of damages
which would be suffered by the Lender by reason of a breach of any of such
covenants and, consequently, agrees that, if the Lender shall xxx for damages
for breach, the Pledgor shall pay, as liquidated damages and not as a penalty,
an amount equal to the value of the Pledged Stock on the date the Lender demands
compliance with this paragraph.
12. [Intentionally Omitted].
13. Further Assurances. The Pledgor agrees that, at any time and
from time to time upon the written request of the Lender, the Pledgor will
execute and deliver such further documents and do such further acts and things
as the Lender may reasonably request in order to effect the purposes of this
Agreement.
14. Severability. If any provision hereof shall be held to be
invalid, illegal or unenforceable in any jurisdiction, then, to the fullest
extent permitted by law, (i) the other provisions hereof shall remain in full
force and effect in such jurisdiction, and (ii) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of such provision in any other jurisdiction.
15. No Waiver; Remedies. No failure on the part of the Lender to
exercise, and no delay in exercising, and no course of dealing with respect to,
any right, power, or remedy under this Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder and
under any of the other Loan Documents preclude any other or further exercise
thereof or the exercise of any other right, power, or privilege. The remedies
provided
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herein and in the other Loan Documents are cumulative and not exclusive of any
remedies provided by law.
16. Successors and Assigns. The covenants, representations,
warranties and agreements herein set forth shall be binding upon the Pledgor,
the Pledgor's legal representatives, successors and assigns, and shall inure to
the benefit of the Lender and successors and assigns. The successor of the
Lender hereunder shall forthwith become vested with and shall be entitled to
exercise all the powers and rights given by this Agreement to the Lender, as if
said successor were originally named as party herein.
17. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
ANY CHOICE OF LAW RULES WHICH WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANY
OTHER JURISDICTION EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE SECURITY
INTEREST HEREUNDER, OR THE ENFORCEMENT OF ANY REMEDIES HEREUNDER, WITH RESPECT
TO THE COLLATERAL SHALL BE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE
STATE OF NEW YORK.
18. Amendments. None of the terms or provisions of this Agreement
may be waived, altered, modified, or amended except by an agreement in writing
signed by the Lender and the Pledgor.
19. Notices. All notices and demands to or upon the respective
parties hereto to be effective shall be in writing and, unless otherwise
expressly provided herein, shall be deemed to have been duly given or made when
delivered by hand, or five (5) days after deposited in the mail, air postage
prepaid, or in the case of notice by telecopier (fax), when sent (subject to
confirmation of receipt), or in the case of overnight courier service and
accepted for next day delivery service, one Business Day after delivery to a
nationally recognized overnight courier service, addressed as follows or to such
other address as may be hereafter notified by the respective parties to this
Agreement:
If to the Pledgor:
Caminus LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Fax No.: (000) 000-0000
Tel. No.: (000) 000-0000
Attention: Mr. Xxxx Xxxxxx
Chief Financial Officer
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If to the Lender:
Fleet Bank, N.A.
000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No. : (000) 000-0000
Tel. No.: (000) 000-0000
Attention: Xx. Xxxxx Xxxxxx
20. Termination. When all Liabilities shall have been paid in full
and the Commitments under the Credit Agreement have expired or been terminated,
this Agreement shall terminate, and the Lender shall cause to be assigned,
transferred and delivered, against receipt but without any recourse, warranty or
representation whatsoever, any remaining Collateral and money received in
respect thereof, to or for the order of the Pledgor. The Lender shall also
execute and deliver to the Pledgor upon such termination such documentation as
shall be reasonably requested as necessary by the Pledgor to effect the
termination and release of the Liens on the Collateral, all at the expense of
the Pledgor.
21. Counterparts. This Agreement may be executed in any number of
counterparts, all of which, when taken together shall constitute one and the
same instrument, and any party hereto may execute this Agreement by signing any
such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their respective duly authorized officers as of the
day and year first above written.
CAMINUS LLC
By:/s/ Xxxx X. Xxxxxx
______________________________
Name: Xxxx Xxxxxx
Title: VP, CFO
Accepted as of this ____
day of September, 1999
Fleet Bank, N.A.,
as Lender
By: /s/ Xxxxx Xxxxxx
______________________________
Name: Xxxxx Xxxxxx
Its: Vice President
